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Another Wave of Cable Consolidation Begins: Atlantic Broadband for Sale

Phillip Dampier June 14, 2012 Competition, Consumer News 3 Comments

A new wave of industry consolidation has begun to pick off smaller independent cable operators who find profits squeezed by increased programming costs and dwindling subscriber numbers.

This month, the private equity firms that back Atlantic Broadband have put the company up for sale. ABRY Partners, which controls the cable venture as well as much larger RCN and Grande Communications, is ready to ditch the Atlantic venture and its 255,000 subscribers in Pennsylvania, New York, West Virginia, Florida, Maryland, Delaware, and South Carolina. Most of the cable systems controlled by Atlantic Broadband were considered “non-strategic assets” by former owner Charter Communications, which sold them to the Atlantic Broadband start-up in 2004.

Although profitable, Atlantic has been losing customers — 4 percent last year alone — and that worries investors. Acquiring television programming continues to grow more difficult for smaller operators who do not receive the volume discounts larger players do. As programming costs rise, pressure on profit margin results.

Atlantic Broadband was the 14th largest cable operator in the country. The sale could bring $1.4 billion to the equity firms, and industry analysts predict another equity firm will likely emerge as the buyer. Most of Atlantic’s systems are outside of the the areas where large cable operators create enormous regional clusters of operations. Time Warner Cable dominates in New York, Comcast in Pennsylvania, Maryland, and Delaware, and Suddenlink in West Virginia.

Atlantic Broadband is not the first smaller cable venture to find itself for sale.

  • Time Warner Cable acquired Insight Communications last August;
  • WideOpenWest announced plans to buy Knology for $750 million in April;
  • WaveDivision Holdings LLC, which serves more than 325,000 residential and business customers in Washington, Oregon and California, also is exploring a sale.

Currently there are 3 comments on this Article:

  1. Ken R says:

    There loosing customers because they are Dishonest!!!!!!! as a customer in PA the VP David Dane back in July of 2012 in a meeting with me stated he was the VP of the entire company (the purpose of the meeting was to see my face because he did not like what I had to say on a website about a Cable Card Issue) but his linkedin profile says he is a regional VP, but to the major issue I own a Cable Card Tuner and there is a FCC law stating I am to be discounted the current rate for each of the cable receiver boxes I 1.) rent 2.) are included in a bundle!

    Mr Dane made it clear that they Will Not Obey This Law! and his interpretation of the FCC law did not match mine! He has a bachelors degree in english acording to his professional profile (unless this is also a lie?) and can’t read a simple Law?

    The FCC has attempted to contact them for 5 months now and they have ignored every contact attempt! Mr Dane said they would not comply! they did not lie about that. He did not tell me they were being sold and it seems they knew that the FCC complaint would not come to the point of them showing up at there doorstep until after the sale that is now final!

    I hope the Canadian company that purchaed ABB fixes the issues with the company soon. and the FCC is still able to punish the former owners for the law violations!

    • Perhaps, but we have several readers in Cogeco’s Canadian service areas (they love to serve small exurban communities and smaller cities outside of Toronto, as well as more remote areas bypassed by Rogers, especially in Ontario).

      They earn mixed reviews.

      Unfortunately, I suspect they will leave your area’s current management in place and let them run the system as they wish for the indefinite future.

      Dane doesn’t own the company, so I’m not sure what difference the sale will make for him personally (or your problem). I think you are on the right track filing an FCC complaint. They ignore the Commission at their peril, although the FCC is not known for its speed in addressing complaints. The FCC can issue fines, and does.

      I’d also file a complaint with the Better Business Bureau (you can do it online). My guess is the more noise you make, the better the chance they will give you what you want to make you go away.

      • Ken R says:

        I did all the BBB and Attorney General bit even Ceton who made the tuner has been trying to help but it seems the FCC is the only option I have left and now it’s a waiting game ABB owes me around $210.00 in discounts I pay the bill they send so in the end I might get free cable for a while sort of on a prepaid basis. Yea I made all the noise I could with out breaking any laws a lot of noise one of there techs that stole my Disabled Wifes medication and was caught on surveillance doing so is in jail now sad thing is he knew the cameras were there I sell the systems and showed it to him there not the brightest bunch here it must be the coal dust on the air?

        anyway thanks for letting me know about our new owners Phillip.

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